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Mekonomen: Interim report January - March 2016

? Revenue increased 3 per cent to SEK 1,424 M (1,382) and has beennegatively affected by Easter. Excluding the acquisition of OpusEquipment, revenue increased 1 per cent. Adjusted for currencyeffects and calculated on the comparable number of workdays, revenueincreased 9 per cent. Sales in comparable units rose 4 per cent.

? Net debt at the end of the period amounted to SEK 1,624 M (1,693),compared with SEK 1,626 M at year-end.

1) During the first quarter of 2015, the last two stores in Denmarkwere discontinued and the Danish store operation is presented in the2015-2016 interim reports in accordance with IFRS 5, Non-currentAssets Held for Sale and Discontinued Operations. The Danish storeoperations were previously included in the MECA segment. With theexception of cash flow and net debt, all amounts pertain tocontinuing operations.

CEO's commentsFavourable underlying growth but weaker result

Underlying growth for Mekonomen Group remained favourable in the firstquarter, despite negative Easter effect. EBIT was lower compared withthe first quarter of 2015, a main cause being a weak EBIT inMekonomen Sweden.

The Group's revenue rose 3 per cent in the first quarter, representingfavourable underlying growth of 9 per cent. As in the fourth quarter,growth was driven in the Group primarily of sales to affiliated andother workshops. Sales of our proprietary brand, ProMeister, was goodand in the first quarter, sales of ProMeister accounted for some 12per cent (10) of the Group's combined spare parts sales.

EBIT declined to SEK 121 M (142). In addition to the negative effectof Easter, operating profit was affected by weak profitability ofMekonomen Sweden, the loss in Denmark and a lower gross margin of theGroup, mainly driven by an unfavourable product mix.

In the first quarter Mekonomen Sweden stands for the largest negativeimpact on EBIT, where negative effect of lower gross margin is notsufficiently offset by increased sales. After the reorganisation thatwas implemented in late 2015, we still do not see that new workingmethods and the introduction of retail store system have the desiredeffect on sales.

The negative product mix effect is mainly a seasonal effect in thefirst quarter.

The loss in Denmark during the first quarter was halved, compared withthe end of 2015, and we have a continued focus on cost efficientincrease of sales in Denmark.

MECA's EBIT in the first quarter, excluding Denmark and the acquiredbusiness Opus Equipment, was largely in line with the preceding year,despite fewer workdays. EBIT for Sørensen og Balchen, in localcurrency, was in line with the preceding year. Mekonomen Norway had alower gross margin due to consumer campaigns, which adverselyaffected EBIT.

We expect conditions for a slightly stronger overall market in 2016,primary as a consequence of favourable new car sales in the recentyears. For Mekonomen Group, the main potential for a stronger marketis linked to a growing fleet of cars aged three years and older.

Focus 2016In 2016, the sales growth is our main focus. Our cost reductionprograms have been implemented according to plan and in 2016 we putour energy to increase the total sales. We continue to see the mostpotential for growth in our core business to B2B customers. Aparticular focus is the growth in Mekonomen Sweden, where new workingmethods with increased presence at customer is expected to givepositive effects. Parallel to this, we will intensify our marketingefforts in Mekonomen Sweden. Continued priority in 2016 is to costeffective increase sales in Denmark.

Our projects for the group-wide e-commerce platform for B2B and B2C,and for enhancing quality in our workshops continue as planned.

With our combination of strong offerings, new initiatives and acustomer focus, Mekonomen Group is positioned for profitable growthin 2016. Magnus Johansson President and CEO

Per Hedblom, CFO Mekonomen AB, tel: +46 (0)8-464 00 00The information in this interim report is such that Mekonomen AB(publ) is obligated to publish in accordance with the SecuritiesMarket Act. The information was submitted for publication on 11 May2016 at 7:30 a.m.